Viva Energy Group Limited – Initial Public Offer

DJ Carmichael Pty Limited (“DJC”) has been invited to participate in an Initial Public Offer (“IPO”) being undertaken by Viva Energy Group Limited (“Viva”).

Viva is seeking to raise between circa $2,399 million and circa $3,058 million via the issue of between circa 960 million and circa 1,154 million fully paid ordinary shares (“Shares”) at an issue price of between $2.50 and $2.65 per Share (“Indicative Price Range”). The Indicative Price Range is the indicative range for the final price (“Final Price”). The Final Price may be set below, within or above the Indicative Price Range (refer to section 7.1 of the Prospectus for further details).
IPO Shares will be issued pursuant to a prospectus lodged with the ASIC on 20 June 2018 (“Prospectus”). The Prospectus may be found at

Participation in the IPO is open to all retail, Sophisticated and Professional Investors.

Viva is one of Australia’s leading integrated downstream petroleum companies, supplying approximately one quarter of Australia’s fuel needs. The Company supplies that fuel through a nationwide retail network of service stations, the majority of which are Shell branded, and to commercial customers across a diverse range of industry sectors.

Investment Highlights

Over the past three years, Viva has supplied over 14 billion litres of petroleum products annually, representing approximately a quarter of Australia’s fuel needs.

Viva generated Pro Forma Underlying EBITDA (RC) of $634 million in FY2017A, and operates across three business segments:

  • Retail, Fuels and Marketing
    • Retail – Viva supplies and markets quality fuel products and lubricants through a national network of 1,100 retail sites, the majority of which are Shell branded and operated by Coles Express under the Coles Alliance. Viva also supplies other retail operators and wholesalers
    • Commercial – Viva is a leading supplier of fuel, lubricants and specialty products to commercial customers in the aviation, marine, transport, resources, and construction and manufacturing industries
  • Refining – Viva owns and operates the Geelong Refinery in Victoria, which converts imported and locally sourced crude oil into petroleum products including gasoline, diesel, jet fuel, aviation gasoline, gas, solvents, bitumen and other speciality products. These manufactured products are then typically distributed through the Retail, Fuels and Marketing segment
  • Supply, Corporate and Overheads – Viva owns or has contracted access to a national infrastructure network comprising terminals, retail sites, storage tanks, depots and pipelines positioned across metropolitan and regional Australia, and also uses a total of three refuelling barges in Sydney and Melbourne. Viva also contracts with a number of transport companies, providing for the efficient distribution of certain products to market. This infrastructure distribution capability supports the broader group. Corporate functions and support services also operate out of this segment

The IPO is being conducted to provide:

  • Viva with access to the capital markets to improve capital management flexibility
  • A liquid market for Shares and an opportunity for others to invest in Viva
  • Viva with the benefits of an increased profile that arise from being a listed entity

The IPO also provides the investors in Vitol Investment Partnership (“Vitol”) with an opportunity to realise part of their investment in Viva. Vitol presently expects to hold between 40% to 50% of the Shares upon completion of the IPO.

Viva generates revenue from fuel and hydrocarbon product sales a well as non-fuel sources, including site lease and license fee income, convenience store royalties and fees from Shell Card. Viva has the sole right to use the Shell brand in connection with the sale of automotive fuels in Australia. 

Products marketed include:

  • Regular and premium petrols
  • Diesel
  • Jet fuel
  • Marine fuel oil
  • Specialty products such as bitumen, lubricants, solvent sand aviation gasoline

Viva is also in the process of rolling out a new Shell premium diesel product, Shell V-Power Diesel, which it launched in 2017.

  • Viva's operations have generated positive pro forma cash flow over each of the 2015, 2016 and 2017 financial years, including pro forma operating free cash flow before capital expenditure of $446 million in FY2017A.
  • Viva expects to continue to generate strong cash flows from operations, with pro forma operating free cash flow before capital expenditure forecast to be $594 million in FY2018 and $639 million in the 12 months ending 30 June 2019.

Further information on the Company and IPO can be found in the Prospectus.
The use of funds raised via the IPO is outlined in section 7 of the Prospectus.

The key risk factors of the IPO are outlined in section 1.4.
An indicative timetable for the IPO is set out below:

Viva table.png

DJC will receive a fee of 0.75% from the Lead Manager(s) for amounts subscribed in the IPO. Of this amount, Advisers will receive 0.375%. For example, for an allocation of $10,000, DJC will receive $75 of which the Adviser will receive $37.50.

Please contact your Adviser on 08 9263 5200 as soon as possible, noting that the bookbuild may close early with no notice. We have used a closing deadline of 7.30am WST Tuesday 3 July 2018, however this is indicative only and subject to change.